In Manheim Township, plans for old Stehli silk mill building still uncertain

By Heather Stauffer,
July 28, 2014 at 8:00 AM

The Stehli & Co. Silk Mill building in Manheim Township has a brand-new roof that took about $1 million and the better part of the past year to install, said developer Matt Bupp. - (Photo / Submitted)

It's coming up on seven years since developer Matt Bupp and a partner purchased the old Stehli & Co. Silk Mill in Manheim Township, and exactly what the spacious facility's future holds is still uncertain.

“We bought this as an investment, and at the end of the day, we weren't certain whether we would actually be the people building the units or not,” says Bupp, of York-based Lenders Group. “We had always looked, thinking we would find someone who would want to collaborate or eventually purchase the project from us.”

Back in 2008, Bupp says, a national company with significant holdings had made a limited commitment to buy the building at 701 Martha Ave. But then the economy took an abrupt turn south, “and then they couldn't get funding.” And, he says, the sheer size of the space — more than 200,000 square feet, one of the largest urban redevelopment projects in the region — is both a positive and a negative, at once redolent with possibility and potentially intimidating to people interested in smaller projects.

“We are having some discussions with someone now about potentially joint venturing, but nothing has been consummated,” he says. “In the interim, we are looking for varied users for the site.”

Approvals are in place for residential with limited mixed use, Bupp says, and he can envision a very mixed use — maybe some residential, some retail, some commercial. Perhaps a business incubator or a film production studio would be a good fit, he says. Lancaster Brewing Co. is currently using about 20,000 square feet for warehousing and packaging.

They have a layout that would use “a good bit” of the space for 137 residential units, Bupp says, and a limited market study showing that the area has more depth for residential options. However, he says, they would have to decide whether to go market-rate, senior or some other option — or a combination.

The work

The building has a brand-new roof that took about $1 million and the better part of the past year to install, Bupp says. That brings the total investment on the property, including its $1.35 million purchase price, to about $2.5 million. Next up comes replacing approximately 2,500 windows, which he estimates will cost about another $2.5 million, and some site work.

“Between all the roofers, contractors, et cetera, we've had 60-plus people working at that building over the last several years,” Bupp says. The building is now on the National Register of Historic Places, which carries historic tax credits, he says, but beyond that, the project's funding has been entirely private.

“People have a tendency to forget about the reality and only see the fantasy,” Bupp says. “They forget about the blood, sweat, tears and time and cost it takes to get projects like this to completion.”

He'd be excited about plugging into a program such as, say, Lancaster's new City Revitalization and Improvement Zone — but only one of the property's approximately 12 acres is in the city, and Randy Patterson, Lancaster City's director of economic development and community revitalization, said it's outside the zone.

In 2012, Pennsylvania became the 30th state to authorize a state historic tax credit to complement the existing federal credit. The credit went into effect in July 2013; however, it is limited to $3 million annually statewide, with an individual project cap of $500,000.

That said, he continues, Lancaster has a wonderful inventory of “very solid” historic structures, particularly on the corridor from downtown going toward Franklin & Marshall College. And to complement them, it has quite a few architects who specialize in working with historic structures.

Whatever direction this project ends up going, Bupp says, local officials have been good to work with, he's excited by the prospect of creating jobs for the community and he predicts his next project will be in Lancaster if not in Baltimore, where he and his wife are moving.

“We firmly believe in Lancaster as a marketplace,” Bupp says. “And as the saying goes, good things take time.”

Developing jobs

These local companies have been involved in the Stehli redevelopment project during the past few years: